Which One of the Following Is a Characteristic of an Acquisition

question 190

Multiple Choice

Which one of the following is a characteristic of an acquisition by stock?

• A) Shareholders must vote and approve an acquisition.
• B) The target firm's management can be bypassed by the use of a tender offer.
• C) Complete absorption of one firm occurs in an acquisition.
• D) Minority shareholders are ignored in the acquisition process.
• E) The acquisition cost is normally lower than that of a merger.

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Definitions:

Horizontal Line

A straight line that moves left to right (or right to left) on a graph and has a slope of zero, indicating no change in the variable it measures.

Marginal Revenue

The increased earnings from the sale of one more unit of a product or service.

Total Revenue

The overall financial gain a business obtains from the sale of goods or delivery of services within a specific timeframe.

Competitive Price-searcher

A market situation where firms have some control over their prices because their products are differentiated, leading them to search for competitive pricing strategies.